Trendline Breakout Strategy TBS

This strategy is a fantastic strategy that is commonly used in forex trading by experienced traders. Trendlines are lines drawn to connect two or more price wave turning points on a chart especially when a trend is formed. It is an important tool for Forex technical analysis of trends.

Trendlines are drawn to link two or more highs (price peaks or inverted V-shape price movement) on a wave to form descending trendlines. They are also drawn to connect two or more lows (price troughs or V-shape price movement) on a wave to form ascending trendlines. Trendlines extends into the future on the chart to act as support or resistance.

Trendlines are used for the analysis of trend on any currency pair and on any time frame. Learning price action is also vital when using the Trendline Breakout Strategy.

Multiple trendlines are drawn on the chart sometimes, especially when price movement cuts across a large time frame. Steep or almost vertical trendlines have a short lifespan.

Technically, many traders use the wick of the candle to draw trendlines, while some use the body of the candle to draw trendlines.

 

Market

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Features

Trendlines form and intersect every now and then. They need to be adjusted more often due to price dynamics.

-The more important a trendline is, the greater the price movement once it is broken or intersected/crossed.

-Important trendlines connect multiple peaks and troughs together and are found in higher time frames such as 1 hr or higher time frames. Lesser time frames are also good but they are noisy (noise is the small random price movement that makes it difficult to identify a trend) at the same time.

-Whenever there is a breakout of a significant trendline, big price movement follows.

-Price intersection/crossing on trendline is important in this type of trading strategy.

-The moment price touches and consolidates around a trendline, then there is a high probability that price will most likely break or intersect/cross that trendline soon.

-When an up moving price crosses a descending trendline and closes above it, there is a high probability that the price will continue to move upwards.

-If a down moving price crosses an ascending trendline and closes below it, it is very likely that the price will continue to move downwards.

Trendline

Check Out

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TBS SIGNALS

Trendline Breakout Strategy (SUN 23 JUN 2019 16:29 GMT):

USDCHF MONTHLY…

Trendline

Trendline Breakout Strategy (SUN 23 JUN 2019 16:06 GMT):

GBPUSD DAILY…

Trendline

Trendline Breakout Strategy (SUN 23 JUN 2019 15:51 GMT):

EURUSD MONTHLY…

Trendline

USDJPY: DAILY CHART (18 MAY 2019 22:00 GMT)

Trendline

GBPCAD: 1 HR CHART (16 MAY 2019 18:32 GMT)

Trendline

SCOPE FOR 16 MAY, 2019 (7:21 GMT):

Trendline

SCOPE FOR 15 MAY, 2019 (7:24 GMT):

Trendline

SCOPE FOR 14 MAY, 2019 (7:38 GMT):

Trendliine

SCOPE FOR 13 MAY, 2019 (7:28 GMT):

Trendline

SCOPE FOR 10 MAY, 2019 (7:28 GMT):

Trendline

USDCAD: 4 HR CHART (09 MAY 2019 19:52 GMT)

Trendline

CADJPY: 1 HR CHART (09 MAY 2019 18:47 GMT)

Trendline

GBPJPY: 1 HR CHART (09 MAY 2019 18:33 GMT)

Trendline

AUDCHF: 1 HR CHART (09 MAY 2019 18:22 GMT)

Trendline

AUDUSD: 1 HR CHART (09 MAY 2019 17:34 GMT)

Trendline

GBPUSD: 1 HR CHART (09 MAY 2019 17:34 GMT)

Trendline

SCOPE FOR 09 MAY, 2019 (7:50 GMT):

Trendline

SCOPE FOR 07 MAY, 2019 (7:08 GMT):

Trendline

SCOPE FOR 06 MAY, 2019 (7:39 GMT):

Trendline

SCOPE FOR 03 MAY, 2019 (7:45 GMT):

Trendline

SCOPE FOR 02 MAY, 2019 (7:55 GMT):

Trendline

SCOPE FOR 30 APR, 2019 (7:46 GMT):

Trendline

GBPNZD: DAILY CHART (29 APR 2019 00:29 GMT)

Trendline

AUDUSD: 1HR CHART (26 APR 2019 06:51 GMT)

Trendline

GBPUSD: 1HR CHART (26 APR 2019 06:34 GMT)

Trendline

XAUUSD: 4HR CHART (22 APR 2019 02:24 GMT)

Trendline

AUDCAD: 4HR CHART (22 APR 2019 01:30 GMT)

Trendline

AFTER

Trendline

 

XAUUSD: DAILY CHART (19 APR 2019 07:47 GMT)

Trendline

GBPAUD: DAILY CHART (19 APR 2019 07:47 GMT)

Trendline

NZDUSD: DAILY CHART (19 APR 2019 07:33 GMT)

Trendline

AFTER

Trendline

NZDCAD: DAILY CHART (19 APR 2019 06:44 GMT)

Trendline

AFTER

Trendline

NZDUSD: 4HR CHART (16 APR 2019 22:04 GMT)

Trendline

EURJPY: 4HR CHART (16 APR 2019 18:15 GMT)

Trendline

AFTER

Trendline

GBPCHF: 30 MINS CHART (15 APR 2019 22:40 GMT)

Trendline

AFTER

Trendline

GBPCHF: 30 MINS CHART (13 APR 2019 15:15 GMT)

Trendline

EURGBP: 30 MINS CHART (13 APR 2019 14:54 GMT)

Trendline

AFTER

Trendline

GBPUSD: 4HR CHART (13 APR 2019 13:59 GMT)

Trendline

AFTER

Trendline

GBPJPY: MONTHLY CHART (13 APR 2019 13:34 GMT)

Trendline

GBPCHF: MONTHLY CHART (13 APR 2019 13:13 GMT)

Trendline

GBPAUD: MONTHLY CHART (13 APR 2019 12:35 GMT)

Trendline

EURGBP: MONTHLY CHART (13 APR 2019 12:17 GMT)

Trendline

GBPUSD: MONTHLY CHART (13 APR 2019 11:08 GMT)

Trendline

AUDUSD: 1HR CHART (12 APR 2019 20:07 GMT)

Trendline

GBPCAD: 4HR CHART (10 APR 2019 19:37 GMT)

Trendline

EURJPY: 1HR CHART (10 APR 2019 19:28 GMT)

Trendline

USDCAD: 1HR CHART (09 APR 2019 19:54 GMT)

Trendline

AFTER

Trendline

EURUSD: 1HR CHART (09 APR 2019 19:36 GMT)

Trendline

AFTER

Trendline

GBPCHF: 1HR CHART (08 APR 2019 19:40 GMT)

Trendline

AFTER

Trendline

GBPJPY: 1HR CHART (07 APR 2019 23:41 GMT)

AUDJPY: 1HR CHART (02 APR 2019 18:49 GMT)

Trendline

GBPCAD: MONTHLY CHART (31 MAR 2019 15:22 GMT)

Trendline

AFTER

Trendline

USDCHF: MONTHLY CHART (31 MAR 2019 15:13 GMT)

Trendline

CADJPY: 1 HR CHART (28 MAR 2019 14:02 GMT)

Trendline

GBPCAD: 1 HR CHART (28 MAR 2019 07:32 GMT)

Trendline

GBPJPY: 1 HR CHART (28 MAR 2019 07:09 GMT)

Trendline

CADJPY: 1 HR CHART (27 MAR 2019 19:38 GMT)

Trendline

AUDUSD: 1 HR CHART (27 MAR 2019 19:20 GMT)

Trendline

AFTER

Trendline

 

AUDJPY: 1 HR CHART (27 MAR 2019 17:41 GMT)

Trendline

AUDJPY: 1 HR CHART (27 MAR 2019 07:13 GMT)

Trendline

AFTER

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USDCHF: 1 HR CHART (26 MAR 2019 20:16 GMT)

Trendline

AUDJPY: 1 HR CHART (21 MAR 2019 23:14 GMT)

Trendline

AFTER

Trendline

USDJPY: 1 HR CHART (17 MAR 2019 20:14 GMT)

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AFTER

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EURJPY: 1 HR CHART (17 MAR 2019 20:01 GMT)

Trendline

AUDUSD: 1 HR CHART (14 MAR 2019 10:42 GMT)

Trendline

GBPUSD: 4 HR CHART (13 MAR 2019 20:19 GMT)

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AFTER

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AUDUSD: 1 HR CHART (13 MAR 2019 09:59 GMT)

Trendline

AUDUSD: 1 HR CHART (12 MAR 2019 11:14 GMT)

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USDCHF: 1 HR CHART (12 MAR 2019 10:33 GMT)

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AFTER

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AFTER

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AUDUSD: 1 HR CHART (11 MAR 2019 11:58 GMT)

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AFTER

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GBPUSD: 1 HR CHART (6 MAR 2019 19:55 GMT)

Trendline

AFTER

Trendline

GBPCHF: 1 HR CHART (6 MAR 2019 19:18 GMT)

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AFTER

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EURGBP: 1 HR CHART (6 MAR 2019 18:13 GMT)

Trendline

AFTER

Trendline

AUDUSD: 4 HR CHART (17 FEB 2019 9:04 GMT)

Trendline

XAUUSD: DAILY CHART (15 FEB 2019 9:45 GMT)

Trendline

GBPJPY: DAILY CHART (15 FEB 2019 8:25 GMT)

Trendline

GBPCAD: DAILY CHART (15 FEB 2019 8:03 GMT)

Trendline

USDCHF: 4 HR CHART (15 FEB 2019 6:48 GMT)

Trendline

EURUSD: 4 HR CHART (17 JAN 2019 22:00 GMT)

Trendline

 

USDJPY: 4 HR CHART (30 NOV 2018 20:09 GMT)

Trendline

USDCHF: 4 HR CHART (30 NOV 2018 19:41 GMT)

Trendline

EURUSD: 4 HR CHART (29 NOV 2018 07:10 GMT)

Trendline

GBPCHF: 4 HR CHART (28 NOV 2018 06:58 GMT)

Trendline

USDJPY: 4 HR CHART (28 NOV 2018 05:57 GMT)

Trendline

EURUSD: 4 HR CHART (24 NOV 2018 09:33 GMT)

Trendline

USDCAD: 4 HR CHART (23 NOV 2018 06:52 GMT)

Trendline

 

GBPUSD: 4 HR CHART (23 NOV 2018 06:47 GMT)

Trendline

GBPJPY: 4 HR CHART (23 NOV 2018 06:43 GMT)

Trendline

 

USDJPY: 1 HR CHART (19 NOV 2018 07:00 GMT)

Trendline

CHFJPY: 4 HR CHART (11 NOV 2018 20:32 GMT)

Trendline

GBPAUD: 4 HR CHART (11 NOV 2018 20:17 GMT)

Trendline

EURUSD: 1 HR CHART (09 NOV 2018 6:21 GMT)

Trendline

 

EURUSD: POSSIBLE INVERTED HEAD AND SHOULDER – 1 HR CHART (06 NOV 2018 5:42 GMT)

Trendline

EURUSD: 1 HR CHART (02 NOV 2018 7:00 GMT)

Trendline

EURUSD: 1 HR CHART (31 OCT 2018 7:11 GMT)

Trendline

USDCAD: 1 HR CHART (29 OCT 2018 7:07 GMT)

Trendline

GBPCAD: 4HR CHART (28 OCT 2018 19:48 GMT)

Trendline

 

EURUSD: DAILY CHART (28 OCT 2018 06:03 GMT)

Trendline

EURUSD: 1 HR CHART (28 OCT 2018 05:06 GMT)

Trendline

 

GBPJPY: 1 HR CHART (28 OCT 2018 04:23 GMT)

Trendline

USDJPY: 4 HR CHART (26 OCT 2018 06:52 GMT)

Trendline

 

USDCHF: 1 HR CHART (26 OCT 2018 06:44 GMT)

Trendline

 

AUDCAD: 4 HR CHART (24 OCT 2018 06:48 GMT)

Trendline

After

Trendline

 

AUDNZD: 1 HR CHART (24 OCT 2018 06:37 GMT)

Trendline

EURUSD: 4 HR CHART (23 OCT 2018 00:10 GMT)

Trendline

 

GBPUSD: 4 HR CHART (23 OCT 2018 00:01 GMT)

Trendline

 

EURAUD: 1 HR CHART (20 OCT 2018 23:08 GMT)

Trendline

 

EURGBP: 4 HR CHART (20 OCT 2018 23:00 GMT)

Trendline

 

USDCAD: 4 HR CHART (20 OCT 2018 22:47 GMT)

Trendline

 

GBPUSD: 4 HR CHART (20 OCT 2018 22:40 GMT)

Trendline

 

USDJPY: 1 HR CHART (20 OCT 2018 22:24 GMT)

Trendline

 

EURUSD: 4 HR CHART (20 OCT 2018 20:13 GMT)

Trendline

 

USDJPY: 30 MINS CHART (19 OCT 2018 06:22 GMT)

Trendline

 

GBPCHF: 4 HR CHART (18 OCT 2018 06:45 GMT)

Trendline

After

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GBPJPY: 4 HR CHART (16 OCT 2018 07:18 GMT)

Trendline

After

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EURCHF: 1 HR CHART (13 OCT 2018 22:42 GMT)

Trendline

 

CADCHF: 1 HR CHART (13 OCT 2018 22:26 GMT)

Trendline

 

EURAUD: 4 HR CHART (13 OCT 2018 22:06 GMT)

Trendline

 

GBPJPY: 4 HR CHART (12 OCT 2018 06:26 GMT)

Trendline

 

EURNZD: 4 HR CHART (12 OCT 2018 06:20 GMT)

Trendline

 

CADCHF: 4 HR CHART (12 OCT 2018 06:12 GMT)

Trendline

EURCHF: 4 HR CHART (10 OCT 2018 00:01 GMT)

Trendline

 

USDJPY: 1 HR CHART (9 OCT 2018 23:50 GMT)

Trendline

 

EURCHF: 4 HR CHART (7 OCT 2018 21:15 GMT)

Trendline

 

USDJPY: 1 HR CHART (6 OCT 2018 23:53 GMT)

Trendline

EURAUD: 1 HR CHART (2 OCT 2018 22:54 GMT)

Trendline

After

Trendline

 

EURJPY: 1 HR CHART (2 OCT 2018 22:46 GMT)

Trendline

 

GBPAUD: 4 HR CHART (2 OCT 2018 07:00 GMT)

Trendline

 

EURCHF: 4 HR CHART (1 OCT 2018 12:28 GMT)

Trendline

 

EURUSD: TREND BREAK, PULL BACK, THEN CONTINUATION -1 HR CHART (1 OCT 2018 09:52 GMT)

Trendline

 

EURUSD: 30MINS CHART (30TH SEP 2018 21:52 GMT)

Trendline

 

EURUSD: 4HR CHART (30TH SEP 2018 21:44 GMT)

Trendline

Ascending and Descending Trendline

Basically, ascending trendlines are drawn to connect two or more troughs/swing lows (tilting or sloping upwards). They are drawn below price.

Trendline

 

However, descending trendlines are drawn to connect two or more peaks/swing highs (tilting or sloping downwards). They are drawn above price.

Trendline

 

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Possible Scenario Before Breakout

Price will either bounce on the trendline or break it. It bounces on trendlines when it fins support or resistance at the trendline area.

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Breakout

Trendline breakout happens when price intersects the trendline.

TrendlineTrendline

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Pull Back and Trend Continuation

Sometimes, price breaks the trendline, pulls back to test the trendline, before continuing in its breakout direction.

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TBS And Bullish Or Bearish Flags

Trendline Breakout Strategy is also applied to bullish and bearish flag setups.

Trendline

 

Fake/False Trendline Breakouts

This is identified after 1 to 3 candle bars might have been formed at the breakout point. They are usually identified with reversal price action. False breakouts lose momentum steam more quickly.

The higher the number of candle bars formed away from the trendline breakout point, the lesser the chances that it will be a false breakout.

The type of candlestick pattern formed at the breakout point also matters. Reversal candle bars will definitely prepare your mind that breakout is possible soon as soon as it forms.

The following candlestick patterns will signal a possible breakout when you see them form shortly after a breakout point; Dark Cloud, Harami, Engulfing, Inside Bar

It is advisable to move stop-loss to break-even or lock-in profit when you see that a reversal candlestick pattern is formed.

Sometimes, the assumed fake/false breakout may also be a temporary pullback, and you trade gets stopped out. You may re-enter the trade once price continues in the direction of the trendline breakout.

Trendline

Trendline

How To Enter Your Trades Using Trendline Breakout Strategy

-Analyse the chart to identify two or more peaks or troughs.

-Connect the peaks or troughs with a trendline and wait for the time when the price will intersect the trendline.

-As soon as the trendline is intersected/crossed by a candlestick, your entry price will be placed a little at the candlestick high or low price. If it is a bullish candle, entry price will be placed a little (say 5 pips) above the high price of the candle. Assuming it is a bearish candle, your entry will be placed a little distance below the low of the candlestick.

-The stop-loss will be placed a little distance below the low of the candle if it is a bullish candle, while the stop-loss will be placed a little distance above the high price if the breakout candle is a bearish candle.

The length of the breakout candle is very important. Long breakout candles are less tradable as the stop-loss tends to increase the risk in the time of fake/false breakout.

Trendline

 

Advantage Of Trendline Breakout Strategy

The main advantage of using trendlines is that trendlines do not lag like other indicators. Indicators signals are sometimes late.

Trendlines helps in identifying major trends, minor trends, and corrections.

 

Trendline Icon on MT4 Application on Computer or Mobile Device

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3 Replies to “Trendline Breakout Strategy”

    1. Trend lines can be drawn in ascending or descending slope with price bouncing off the line to form resistance or support for price. Major trends are characterized by longer unbroken trendlines. Minor trend is identified with shorter unbroken trend lines.

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